Unit 2 Exam Workshop

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U2 Economics Exam Workshop

By Catherine Dawson, Eileen Hu, Shannon Lane

What are we looking for?

​1 Mark	​2 Marks	Longer Responses
​Identify	​Compare	​Analyse
​State	​Compare & Contrast	​Evaluate
​Describe	​Discuss	​Justify
​Calculate	​Explain	​Recommend
​	​Distinguish	​
​	​Draw/Illustrate	​

Open Ended

State 3 negative consequences of high unemployment.

Open Ended

Identify two factors that cause an increase in supply Country A's currency.

Fill in the Blanks

Math Response

Calculate the overall increase in GDP if an initial increase in government spending is $1 million and MPC 0.75

Type answer here

Correct Answer: 4000000

Deg^°

Rad

Open Ended

Identify two factors that will cause a decrease in AS

Open Ended

Create ONE question using a 1 mark command term: identify, state, calculate, describe

What are we looking for?

​1 Mark	​2 Marks	Longer Responses
​Identify	​Compare	​Analyse
​State	​Compare & Contrast	​Evaluate
​Describe	​Discuss	​Justify
​Calculate	​Explain	​Recommend
​	​Distinguish	​
​	​Draw/Illustrate	​

Open Ended

Explain an example of ONE of the following types of unemployment (seasonal, frictional, structural, cyclical).

Open Ended

Explain why aggregate demand is a downward sloping curve.

Open Ended

Explain the likely effect on Country A's consumption, government spending and exports component of GDP if the trading partners are having a recession.

Open Ended

Distinguish between unemployment and under-employment.

Open Ended

Distinguish between comparative advantage and absolute advantage.

Open Ended

Create ONE question using a 2 mark command term: Explain, Compare, Compare and Contrast, Discuss, Distinguish, Draw/Illustrate

What are we looking for?

​When answering any question go through the following steps:

1. ​Identify the command term;

2. Check the number of economic concepts;

3. Look at the marks for the question.

Open Ended

Do you have any questions about Part B of the exam?

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BREAK TIME!

Essay Time!

Now we are going to try some essay writing and look at some sample paragraphs.

Let's Write!

Expansionary fiscal policy means the government increases spending or cuts taxes to help people spend more money. When people pay less income tax, they have more money to buy goods and services. This increases aggregate demand, which helps businesses grow and hire more workers. In Ecoland, economic growth has fallen from 3.4% in 2020 to just 1.3% in 2022. Unemployment has also increased to 6.7%, which is well above the 5% goal. Inflation is only just above the 2–3% target, at 3%, so there is room to support the economy without causing big inflation problems.

High Level Sample

Paragraph 1

Demonstrates strong knowledge of fiscal policy and theory (Criterion 1), with detailed application of stimulus data (Criterion 3). Supports the position with logical reasoning (Criterion 2).

Comments

Expansionary fiscal policy means the government increases spending or cuts taxes to help people spend more money. When people pay less income tax, they have more money to buy goods and services. This increases aggregate demand, which helps businesses grow and hire more workers. In Ecoland, economic growth has fallen from 3.4% in 2020 to just 1.3% in 2022. Unemployment has also increased to 6.7%, which is well above the 5% goal. Inflation is only just above the 2–3% target, at 3%, so there is room to support the economy without causing big inflation problems.

Sample

Paragraph 1

Ecoland’s monetary policy is already quite tight. The interest rate is still high at 4%, even though it has been lowered a little in the past. High interest rates make borrowing expensive, which can reduce spending. Also, business confidence is low because of global recessions. This means that fiscal policy is needed to help increase demand. By cutting taxes, the government can give people more money to spend now, which will help economic recovery.

High Level Sample

Paragraph 2

Compares policy approaches using current and historical context (Criterion 3). Evaluates the effectiveness of fiscal policy given tight monetary conditions (Criterion 2).

Comments

Ecoland’s monetary policy is already quite tight. The interest rate is still high at 4%, even though it has been lowered a little in the past. High interest rates make borrowing expensive, which can reduce spending. Also, business confidence is low because of global recessions. This means that fiscal policy is needed to help increase demand. By cutting taxes, the government can give people more money to spend now, which will help economic recovery.

Sample

Paragraph 2

Some people may worry about the government’s high debt and think more spending is a bad idea. But if the government does not act now, the economy could get worse. This would lead to more unemployment and less tax revenue, making the debt problem even bigger. If the tax cut helps the economy grow, the government can collect more taxes later to help pay down the debt.

High Level Sample

Paragraph 3

Strong evaluation of policy trade-offs (Criterion 2). Uses logical reasoning to assess long-term benefits versus short-term costs (Criterion 3).

Comments

Some people may worry about the government’s high debt and think more spending is a bad idea. But if the government does not act now, the economy could get worse. This would lead to more unemployment and less tax revenue, making the debt problem even bigger. If the tax cut helps the economy grow, the government can collect more taxes later to help pay down the debt.

Sample

Paragraph 3

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